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January 14, 2016

Comparing Income-Driven Repayment Plans

There are now five different income-driven repayment plans: Income-Contingent Repayment (ICR), Income-Based Repayment (IBR), Pay As You Earn (PAYE), Income-Based Repayment for New Borrowers (New IBR), and now Revised Pay As You Earn (REPAYE).  Calculating Monthly Payments Income-driven plans calculate payments as a percentage of “discretionary income”.  Discretionary income is defined as the difference between a borrower’s Adjusted Gross Income (AGI) and 150 percent of the poverty guideline for the borrower’s family…

By Heather  |  Category:  REPAYE, Pay As You Earn, IBR, Student Loan Repayment  

December 17, 2015

REPAYE application goes live

Borrowers may now enroll in REPAYE using the newly updated electronic Income-Driven Repayment application at studentloans.gov Here’s a preview of the paper application for your viewing enjoyment.  The Department of Education’s Repayment Estimator has also been updated to include a REPAYE calculation.  And here is the official information about REPAYE and the other Income-Driven Repayment plans posted on studentaid.ed.gov.

By Heather  |  Category:  REPAYE, Student Loan Repayment  

November 30, 2015

How Student Debt Impacts Homeownership

Many thanks to Satinder Haer of Zillow for contributing this post!  -Heather Buying a house is the biggest milestone after graduating college for many people. But if you’re facing a mortgage-sized student loan payment each month, homeownership may feel impossible. One common belief is that student loan debt prevents many from saving for a down payment. However, new numbers show student loan debt might not be a major hindrance to homeownership. As long as you obtain a four-year degree or higher, student debt has a minor impact on your…

By Heather  |  Category:  Personal Finance, Student Debt  

October 27, 2015

Final REPAYE Regs No Big Surprise

At last the final regulations are published! There are a few changes from the draft rules, but nothing major. The best thing? Borrowers can access payments set at 10 percent of "discretionary income" regardless of when we borrowed.  Less great:  If you borrowed for graduate or professional education, forgiveness is after 25 years rather than 20 years (or 120 payments for Public Service Loan Forgiveness) and spouses will not be able to separate their income, even if they file a separate tax return. Key provisions of the new REPAYE plan…

By Heather  |  Category:  REPAYE, Student Loan Repayment  

August 28, 2015

May clergy qualify for Public Service Loan Forgiveness?

Yes, as long as they spend at least 30 hours a week engaged in activities “unrelated to religious instruction, worship services, or any form of proselytizing.”   How do we know? The statute and regulations governing Public Service Loan Forgiveness are clear: The statue establishing Public Service Loan Forgiveness specifies that employment for a 501(c)(3) organization qualifies.  Churches have status as 501(c)(3) organizations. The regulations governing administration of Public Service Loan Forgiveness assert that a 501(c)(3)…

By Heather  |  Category:  Public Service Loan Forgiveness  
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